1851

When buying a franchise,&nbsp;<a href="https://www.youtube.com/watch?v=MXWUCNdqyII&amp%3Blist=PLYoYh1wSeGsTqBrKtJH101pFoV4qlvpGc&amp%3Bindex=4&utm_source=1851franchise.com&utm_medium=article&utm_campaign=1851-growth-club-when-buying-a-franchise-what-can-i-afford-2723893" target="_blank" rel="nofollow">what can I afford?</a> 1851 Franchise CEO&nbsp;<a href="https://www.linkedin.com/in/powills?utm_source=1851franchise.com&utm_medium=article&utm_campaign=1851-growth-club-when-buying-a-franchise-what-can-i-afford-2723893" target="_blank" rel="nofollow">Nick Powills</a> of&nbsp;<a href="https://www.youtube.com/watch?v=ef4aftFHiVk&utm_source=1851franchise.com&utm_medium=article&utm_campaign=1851-growth-club-when-buying-a-franchise-what-can-i-afford-2723893" target="_blank" rel="nofollow">1851 Growth Club</a> (also referred to as “Growth Club”) answers this question and other and financial franchising advice.For starters, approach franchising with enough financial bandwidth to ensure you are not completely overwhelmed. Deciding the exact budgetary number that entails is a little more nuanced.In one example from Powills, let's say you buy a $100K service business that requires a van instead of a brick and mortar. You need to pay for the franchise fee, which we will guesstimate at $40K. Then, you need another $60K to make the business operational. Most of this can be financed.As a basic rule of thumb, you should aim to see a three-year payback on your investment. So, if you invest $100K, you need to make $33K a year in profit to pay off your investment.&nbsp;You might not be able to afford $100K all at once, but there are other options.&nbsp;“What I can afford is not all cash-based,” explained Powills. “Sometimes grit or hustle can offset the cash.”When Powills started his own business, he did so with roughly $10,000 in his bank account.“But nobody was going to have more hustle than me,” said Powills. “Sometimes the franchisor will recognize that.”The best way to determine what you can afford is to do your research. Decide what you are passionate about and narrow your search down to a few brands. From there, you can find out how much financial bandwidth you need in terms of the franchise fee, royalties and other fees by looking at the Item 19 in each brand’s Franchise Disclosure Document (FDD). Ensure you consider how you will pay your bills and what level of spending you are comfortable with that will still allow you to scale your business.“You will know your own risk tolerance, you will know what is in your bank account and you probably will have done some homework on leveraging your 401(k) or your assets,” said Powills.&nbsp;Still feeling stuck? Reach out to Growth Club to schedule a free consultation for further personalized advice.&nbsp;To learn more, click&nbsp;<a href="https://www.youtube.com/watch?v=MXWUCNdqyII&amp%3Blist=PLYoYh1wSeGsTqBrKtJH101pFoV4qlvpGc&amp%3Bindex=4&utm_source=1851franchise.com&utm_medium=article&utm_campaign=1851-growth-club-when-buying-a-franchise-what-can-i-afford-2723893" target="_blank" rel="nofollow">here</a>.

1851 Growth Club: When Buying a Franchise, What Can I Afford?

1851 Franchise

1851 Growth Club CEO Nick Powills shares his expertise on how to determine what you can comfortably afford when buying a franchise. 

This brand page has been paid for by 1851. Content within this page that is paid will showcase a Sponsored icon. This means the brand has engaged 1851 FRANCHISE to write the content. Content without the Sponsored Icon is aggregated media placements the brand earned. Questions can be sent to editorial@1851franchise.com

1851-growth-club-when-buying-a-franchise-what-can-i-afford

HomeTeam Inspection Service

Photo of HomeTeam inspector in red polo and khaki pants, walking by branded vehicle

Real Estate Today: Behind the Drywall: The Truth About Home Inspections

purpose-of-home-inspection

Dog Training Elite

Dog Training Elite Franchise - DTE - National Service Dog Month - 1851 Franchise

Celebrating Service Dogs: Why Proper Training Changes Lives — And How Dog Training Elite Is Leading the Way

dog-training-elite-national-service-dog-month

Senior Care Authority

How This Senior Care Authority Franchisee Turned Love for His Grandparents Into a Lifelong Calling

how-this-senior-care-authority-franchisee-turned-love-for-his-grandparents-into-a-lifelong-calling

Hometown News: Like Father, Like Son — Family-Run Inspection Business Blends Generations of Expertise and a Keen Eye for Detail

father-son-home-inspection-franchise-florida

KLA Schools

KLA Schools of Beachwalk Hosts Admissions Kick-Off Celebration

kla-schools-of-beachwalk-hosts-admissions-kick-off-celebration

Buying a Franchise Masterclass

 Franchise Opportunities

Get Support Buying a Franchise

How to Buy a Franchise White Paper

How to Buy a Franchise

How to Sell Franchises

How to Grow a Franchise

Find a Franchise Supplier

1851 Franchise Opportunities

Franchisor News

Franchisor Power Rankings

FranCamp Mastermind Summit

Franchise Development Website Builder

Franchise Resources

What ALEC-Laffer's Report Means for Franchising

Website Awards

Power Rankings

About 1851

Advertise on 1851

Contact 1851 Editorial

Terms of Use

1851 Login

GROWTH CLUB LOGIN

facebook

instagram

twitter

linkedin

youtube

Potbelly to be Acquired by RaceTrac in $566 Million Deal 

racetrac-acquires-potbelly-in-566-million-deal

Health Care Hiring Slowdown Highlights In-Home Care Franchise Opportunities - 1851 Franchise Agg

Health Care Hiring Slowdown Highlights In-Home Care Franchise Opportunities 

health-care-hiring-slowdown-in-home-care-franchise-opportunities

Caribou Coffee Names Scott Kennedy CEO, Eyes Continued Growth

caribou-coffee-names-scott-kennedy-ceo-eyes-continued-growth

McDonald’s Launches New Extra Value Meals as Consumer Demand for Value Continues to Climb

mcdonalds-launches-extra-value-meals

Power Eats: Smoothie King Rolls Out Food Nationwide To Fuel Franchise Growth

smoothie-king-food-menu-power-eats

Hely and Hiral Patel Bring Their Longtime Dream to Life With The Brass Tap

brass-tap-franchise-pasadena-maryland-hely-hiral-patel

Franchisee spotlight graphic with photo of Ricki Oberoi and Layne's Chicken Fingers logo

Multi-Unit Wendy’s Operator Signs 12-Unit Deal With Layne’s Chicken Fingers

ricki-oberoi-laynes-chicken-fingers-growth

graphic image of an 1851 franchisee spotlight brayden and johnny steven of teriyaki madness

Father-and-Daughter Team Bring Teriyaki Madness to Wichita, Kansas, With Big Expansion Plans

johnny-brayden-steven-teriyaki-madness-wichita

Young Entrepreneur Parth Patel Is Bringing Paris Baguette to the Cleveland Area

young-entrepreneur-parth-patel-is-bringing-paris-baguette-to-the-cleveland-area

1851 Keyword - The Secret To Succeeding With a Part-Time Franchise Is Picking the Right Model

The Secret To Succeeding With a Part-Time Franchise Is Picking the Right Model

part-time-franchises-picking-the-right-model

DevHub - Meet the Supplier - 1851 Franchise

DevHub: Scalable Digital Marketing for Franchises and Multi-Location Brands

devhub-meet-the-supplier

Design with school-aged child standing on pencil with text "Education Franchises" and "<$500K"

Top Education Franchises Under $500K To Explore in 2025

top-education-franchises-under-500k

1851 Franchise Deep Dive graphic with Sparkle Squad logo

1851 Growth Club: When Buying a Franchise, What Can I Afford?

MORE STORIES LIKE THIS